eretning

Annual Report 2019 ANNUAL REPORT 2019 ANNUAL REPORT 2019

Content

The Chairman's Report 4

The CEO's Report 8

Highlights from 2019 12

The Charts 18

Photo on front and back: Daniel Tafjord

Koda Lautrupsgade 9 2100 København Ø Phone: +45 33 30 63 00 [email protected] www.koda.dk

2 Koda Annual Report 2019 Koda Annual Report 2019 3 THE CHAIRMAN’S REPORT THE CHAIRMAN’S REPORT

Koda: Stepping into the

2019 was another eventful year in Koda distributed at all if no one had been around and a fantastic year for Koda’s revenues to to manage the rights. False, because the Future on rightsholders. Once again, we passed the revenues weren’t really generated by Koda, magic one-billion kroner turnover mark, but by the composers and who which is very impressive in a global market created the music. for music rights characterised by fierce competition and constant changes and In Denmark we have a strong, rich and Strong challenges. diverse music culture, which helps to ensure the high revenues generated . Speaking about `Koda's revenues’ is both Few places can match the high music true and false. True, because most of the consumption rates we see in Denmark. But a Legs revenues would not be collected and strong music culture doesn’t simply happen.

Photo: Lars Svankjær Koda Annual Report 2019 5 THE CHAIRMAN’S REPORT THE CHAIRMAN’S REPORT

On the one hand, it requires the possibility of music scene in the future. That’s what we do emerged even stronger with a new man at out and reorganisation of the two schemes making money from music: creating music when we reinvest in music culture. the helm. Anders Lassen spearheaded a very leading up to 2024, opting instead to focus must be financially viable and there must important transformation and modernisation on supporting the creation of new music and be a dynamic market. But it also requires In 2019, we crafted the first overall cultural of Koda and produced great results over a diverse music culture through the cultural something more than just commercial strategy for Koda. Conducted as a a period of nine years. Now the time had contributions. This will affect many adversely, market thinking; commercial concerns collaboration between the member come for a change: Gorm Arildsen has taken but we have to relinquish certain inherited should not control everything, because then associations, Koda’s management and the over the helm and delivered six months privileges in order to secure the legitimacy we run the risk of a bland uniformity that Board of Directors, this work has identified of excellent results, driven by ambition, – and hence the future – of Koda’s business would be detrimental to the culture, the four over-arching areas where we particularly decisiveness and assured confidence. and of Koda’s cultural work. music scene and to the market itself in the want to make a significant difference: Greater Gorm has set ambitious goals for Koda both long term. diversity through a better gender balance in internally and externally and will define a new Koda strides forth on two legs – one is music; better conditions for future users and era for Koda. business, the other is culture. Sometimes In Koda, we reinvest a percentage of the creators of music; exports and international the two are close to each other, sometimes revenues generated in creating new music exchanges; and, finally, cultivating our talents In 2019, Koda was randomly selected for they’re a bit further apart. But we cannot every year. We do this via the cultural and elite. With this cultural strategy, we have an audit by the international umbrella do without either of them. Legitimacy – in contributions distributed by Koda Kultur, defined areas for joint and unified efforts and organisation for collective rights everything we do, both in business and fuelled by an ambition to ensure that a have all committed to take action and see management societies, CISAC. In this culture – is crucial in order for Koda to diverse range of music is on offer and to effects. connection, all aspects of Koda’s operation maintain its position for the benefit of develop and strengthen the music culture were reviewed. The results are very rightsholders and members of all kinds. and music scene in Denmark. "Koda will not limp favourable, with Koda receiving high praise: in many respects Koda is lauded as a strong Koda will not limp into the future; we will In that sense, you might say that two tracks into the future; we example for others to follow. Sadly, however, dash at it at full speed – on both legs. run side by side in Koda: business and there are a few notes of discord, too: on culture. We need to be constantly vigilant will dash at it at full two specific points, Koda does not comply to ensure that it’s possible to make money with the clear demands for equal treatment, out of making music and that setting up an speed – on both legs objectivity and transparency. These two agreement is simple for those who have to points concern our schemes for first Niels Rønsholdt pay for the public use of music. And at the 2019 was also the year where we got a performance awards and concert subsidies. Chairman of the Koda Board of Directors same time, we must work systematically to new CEO in Koda. The changeover has create fertile soil for a strong and diverse progressed smoothly and well, and Koda has In response, the Board has proposed a phase

6 Koda Annual Report 2019 Koda Annual Report 2019 7 THE CEO’S REPORT THE CEO’S REPORT

"We know that we must be really good at adapting to the changes that will face us

alfway through 2019, we at Koda took When we compare ourselves with other Hour first steps in what we might call a collective rights management societies strategic change of direction. For the times today, we evaluate ourselves and them by are changing, and so too are the conditions means of some very classic benchmarks and for collective rights management and, parameters: Revenues, revenues per capita, A Change of hence, Koda’s task and role in the world. If administration cost rates, distribution speed, we want to still be among the best collective customer satisfaction, member satisfaction. rights management societies in the world But what will good collective rights five and ten years from now, we need to management entail in a future global digital Direction understand that what qualifies us for that ecosystem? What does it take to attract and position today may not be what qualifies us maintain a large repertoire in a market where in the future. rights may be sold piecemeal in tiny slices? What should we do to ensure that we can

Photo: Natascha Thiara Rydvald Koda Annual Report 2019 9 THE CEO’S REPORT THE CEO’S REPORT

price the rights we trade at the value we Market development and licensing, and Extensive development work led to the inquiries 24/7. Most recently, we have think they are worth? What should we offer – 3) Relations. launch of monthly distributions in 2019, launched a project on better monitoring and and what should we stand for – in order to be which means that revenue is now passed tracking of commercials. . the first choice? In that sense, Koda is in a fantastically on to those who earned it much faster than exciting place right now. There is plenty of before. Finally, in collaboration with Teosto (Finland), We do not know, and this is where the potential and a lot to fight for. And when we we have embarked on the first phase of strategic change of direction takes its look back on the year gone by, we look back In 2019, we were also able to finally launch preparing to replace our entire digital beginning. Because that’s exactly what we on yet another year of great results. the Dashboard that many of you – in platform. The new platform will become the need to find out. But we do know one thing: particular music publishers and major basis for ensuring that five and ten years we know that we must be really good at members – have been asking for in order from now, we still have the best possible adapting to the changes that will face us on "There is plenty of to get a better overview. As far as Koda’s foundation for servicing our members and a regular basis. We know that we need to customers are concerned, we launched, in customers. develop and deepen our relationships with potential and a lot collaboration with Gramex, a new product our members, customers and partners so that better matches the needs of very large And the development efforts continue. I that we understand the needs we should to fight for customers with large businesses. Members would like to take this opportunity to thank meet. We know that we must develop our and customers both rewarded these efforts our members, customers and partners for technological platforms and our skills by reporting higher satisfaction rates in 2019. a great year, where we also took the time to - continuously and in a timely manner. And On the political arena, strong collaboration gaze into a future we will all shape together. we must apply an open, global outlook and among the Danish stakeholders, politicians A number of pilot projects have helped constantly strive to leave a strong cultural and GESAC (the umbrella organisation for us uncover and assess the value of new and political imprint, including outside our European CMO’s) led to a breakthrough in technology. By continuously working with own little corner of the world. 2019 when we succeeded in getting the carefully delimited tests, we can ensure that Copyright Directive approved. We hope that we only invest in what creates real value Gorm Arildsen Based on this, 2019 saw us formulating with this directive in place, we will be able to for the business. A few examples from the CEO a development project that will be set in embark on a journey towards fairer payment past year include the implementation of motion in 2020. Taking a new organisational to our members from the major international two types of artificial intelligence: Machine structure as our springboard, we will act services who have enjoyed safe harbour for Learning, which will help us reduce manual on the basis of three strategic focus areas: years, having no real incentive to enter into work associated with music reporting, and 1) Attracting and maintaining repertoire, 2) fair agreements. a Chatbot feature that answers customer

10 Koda Annual Report 2019 Koda Annual Report 2019 11

HIGHLIGHTS FROM 2019 HIGHLIGHTS FROM 2019

Exceeding EUR 135 million Indfortæg the thirdter year in a row Over milliarden for tredje år i træk Turnover Distributed to rightsholders Admin rate EUR 136 million EUR 121.4 million 11,1% 1.200.000

1.000.000

800.000

600.000

400.000

200.000

0 Highlights 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Koda Turnover – by area 1 from 2019 Together, TV and Radio account for more than 40 per cent of Koda’s total turnover. Online contributes 25 per cent, while concerts and background music account for just under 10 per cent each.

In milllion EUR

TV 48

Online 34

Radio 16

Concert 76

Background 14

Abroad 8

Cinema 2

KulturPlus 0.5

Foto: Jasper Carlberg Koda Annual Report 2019 13 HIGHLIGHTS FROM 2019 HIGHLIGHTS FROM 2019

Positive trends in Koda’s revenues Reporting rate

of Koda’s distributions are based on full and accurate reporting of the music played. Seven per cent of the distributions are based on reused, representative data or samples of 87% 45% music usage. Koda is constantly working to The number of mega-concerts Many blockbusters from 2018 and 2019 93% increase the rate of full reporting. rose dramatically in 2019 brought more Danes to the cinemas

Faster distributions 34% 29% The use and supply of video streaming more people have a subscription to a services continue to rise music streaming service

Paying 11 EUR Members and works out twice distributions 14 as fast a year million

The time from Koda has gone from This is the increase in 1,714 100,000 2,600,000 performance to payment making 4 annual the distributed revenues new members new works from new works in Koda’s has been halved for many distributions to 11 – one in 2019 compared to Koda members total repertoire of Koda’s main distribution every month, except in the corresponding areas, including TV, Radio July. performance period the 45,860 in total 1.400.000 in total 25,200,000 in total and Concert. year before.

14 Koda Annual Report 2019 Koda Annual Report 2019 15 395 mio. kr. til 25.214 Koda-medlemmer

HIGHLIGHTS FROM 2019 HIGHLIGHTS FROM 2019

Distributions Koda Kultur invigorated the music scene to the tune of EUR 9.6 million in 2019 In 2019, Koda distributed EUR 119 million to Koda members and rightsholders abroad. The year before, Koda distributed EUR 110 million. The increase in 2019 is mainly due to the fact that Koda doubled the The objective of Koda Kultur is to support the development of music and to help nurture a strong music speed of its distributions in 2019, transitioning from 4 to 11 annual distributions. As a result, last year, scene operating at the highest level. Each year, up to ten per cent of Koda’s net income is allocated to Koda managed to distribute far more of revenues earned during the year than previously. The figure cultural contributions, helping to ensure favourable conditions for a vibrant music scene and to im- below shows the distributions to Koda’s members by income groups in DKK. prove the structural conditions underpinning Koda’s business. By the end of 2019, Koda’s first cultural strategy was adopted. It will determine how this support will be distributed in the future. The figure below shows how the support was allocated to various purposes in 2019.

EUR 66 million EUR 53 million to rightsholders to Koda members represented by societies abroad 1% of the distributions go out to 16,351 members who earn up to DKK 1,000 a year in Koda distributions 77% of the distributions go out to 566 members who earn more than DKK 100,000 a year in DKK 1 = EUR 0.13 Koda distributions

Income in DKK Authors Publishers Total DKK, total

1 - 1.000 16.176 175 16.351 3.235.759 1.001 - 5.000 4.592 69 4.661 10.920.902

5.001 - 10.000 1.354 40 1.394 9.988.690 Purposes supported by cultural contributions, EUR million 10.001 - 30.000 1.455 47 1.502 26.465.288 Working grants, study grants 2.6 Support for original Danish music 1.2 30.001 - 50.000 356 16 372 14.345.884 and travel grants Administration of cultural contributions 1.1 50.001 - 100.000 344 24 368 25.633.277 Production, publication or distribution 1.8 100.001 - 400.000 366 45 411 80.840.610 Cultural policy activities 0.8 PR activities 1.3 400.001 - 124 31 155 223.163.684 Concerts, awards, study grants etc. 0.8 Total 24.767 447 25.214 394.594.094

16 Koda Annual Report 2019 Koda Annual Report 2019 17 THE CHARTS THE CHARTS

The Koda Chart 2019 Denmark The Top Ten highest earning Danish tracks in 2019 include several newcomers to the list, specifically Lord Siva & Vera, Nicklas Sahl, Karl William and Christopher. Still, the top slot belongs to an old stalwart of the list: and the track ‘Love Someone’. The Top Ten lists the highest-earning tracks in Denmark in 2019 where at least one Koda member has been involved in its creation.

Love Someone Lukas Graham 1 Composer/Writer Jaramye Jael Daniels//Stefan Forrest/James Alan Ghaleb/David James Labrel/Morten Wild Pilegaard/ 2 Hugo Helmig Composer/Writer Hugo Helmig Toft Simonsen/Emil Sebastian Albæk-Falk/ Daniella Binyamin New Eyes Nicklas Sahl 3 The greatest Composer/Writer Birk Stenbæk Kristensen/Nicklas Sahl The Rascal 4 Phlake Composer/Writer Jonathan Elkær/Mads Bo Iversen/Troels W P Nielsen/ hits of 2019 Daniel Maurice Wilson Sun In Our Eyes MØ, Diplo 5 Composer/Writer Henry Agincourt Allen/John Graham Hill/Ilsey Anna Juber/Karen Marie Ørsted/Thomas Wesley Pentz High Hopes 6 Panic! At The Disco Composer/Writer Jonas Jeberg/Samuel Hollander/Ilsey Anna Juber/ William Ernest Lobban Bean/Tayla Parx/Lauren Please Don't Lie Pritchard/Jacob Sinclair/Brendon Boyd Urie/ Hugo Helmig 7 Jenny Owen Youngs Composer/Writer Hugo Helmig Toft Simonsen/Emil Sebastian Albæk-Falk Paris 8 Lord Siva, Vera Composer/Writer Willliam Frederik Asingh/Brian Sivabalan/Mads Koch Kjærgaard/Andreas Dyre Odbjerg Samme Vej Karl William, Burhan G 9 Composer/Writer Karl William Wandahl/Fridolin Nordsøe/Burhan Genc Irony 10 Christopher Composer/Writer Christopher Lund Nissen/Petter Carl Tarland Lambertz/ Pär Andreas Westerlund

Photos: Lukas Graham: Rasmus Weng Karlsen, Hugo Helmig: Cecilie Tchikai, Nicklas Sahl: Press photo Koda Annual Report 2019 19 THE CHARTS THE CHARTS

The Koda Charts 2019 The Koda Charts 2019 Danish hits abroad Foreign hits in Denmark Lukas Graham are not only prominently featured on the Danish chart: the band is also ranked as both All in all, the five tracks on the list of the highest earning foreign hits in Denmark in 2019 were written number one and number four on the Top Five of the highest earning tracks abroad in 2019. The chart lists and composed by a total of 25 different music creators. In first place we find the huge hit ‘One Kiss’ by the top-five tracks, created by least one Koda member, which have generated the greatest earnings abroad Calvin Harris and Dua Lipa - incidentally, this is one track on the list to have the lowest number of creators in 2019. involved. The chart lists the music tracks created by non-Koda members that have generated the highest income in Denmark in 2019.

One Kiss 1 Calvin Harris, Dua Lipa Composer/Writer Dua Lipa/Jessie Reyez/Adam Richard Wiles 7 Years Lukas Graham These Days 1 2 Rudimental Feat. Jess Glynne, Composer/Writer Macklemore & Dan Caplen Morten Pilegaard/David James Labrel/Christopher Steven Brown/Lukas Forchhammer/Morten Ristorp/Stefan Forrest Composer/Writer Piers Sean Aggett/Amor Amir/Julian C Bunetta/Daniel Sebastian Caplen/Kesi Dryden/Ben Haggerty/Jamie Scott/ Solo Dance Leon Anthony Rolle/John Henry Ryan 2 Martin Jensen Shotgun Composer/Writer 3 George Ezra Peter Bjørnskov/Mads Dyhrberg Hjerl-Hansen/ Martin Jensen/Lene Dissing Composer/Writer George Ezra Barnett/Joel Laslett Pott/ Barbie Girl Frederick John Philip Gibson 3 AQUA Young Blood Composer/Writer 4 5 Seconds Of Summer Rene Dif/Claus Norreen/Søren Rasted/Lene Crawford Nystrøm/Karsten Dahlgaard/Johnny Mosegaard Pedersen Composer/Writer Louis Russel Bell/Luke Robert Hemmings/Calum Thomas Hood/Ashton Fletcher Irwin/Ali Tomposi/ Lukas Graham is number one and number four on the list of Love Someone Andrew Wotman the Koda members’ highest-earning tracks abroad. 4 Lukas Graham Photo: Rasmus Weng Karlsen Composer/Writer In My Blood Jaramye Jael Daniels/Lukas Forchhammer/Stefan 5 Shawn Mendes Forrest/James Alan Ghaleb/David James Labrel/Morten Pilegaard/Morten Ristorp Composer/Writer Scott Harris Friedman/Teddy Geiger/ Played-A-Live Shawn Mendes/Geoffrey Elliot Warburton 5 Composer/Writer Michael Parsberg Hansen/Morten Friis/Uffe Savery

Dua Lipa joined Jessie Reyez and Adam Richard Wiles in making the highest-earning foreign hit in Denmark in 2019. Photo: Hugo Comte

20 Koda Annual Report 2019 Koda Annual Report 2019 21 eretning

Koda Lautrupsgade 9 2100 København Ø Denmark Phone: +45 33 30 63 00 [email protected] www.koda.dk